Selling 'subject to sale of buyers home'

[dragonl]

Hi all,
We have received a good offer for our house and would like to go sale agreed. The big difficulty is that the buyer (Dublin/Wicklow based) has to sell their own home which is just now on the market. We have had a history of sale agreeds falling through (2 in last few months) and are therefore reluctant to commit to a contract subject to sale of buyers home. We dont want to fall into a no win situation where our house is committed but the sale is nowhere near closing.

To address the uncertainty of this position can we put a timeline/deadline on the contract after which the 10% deposit is forfeited and our house goes back on the market. Obviously we would generously negotiate the timeline (9/10 months).

Thanks in advance for your replies!

 

[Stifster]

If there is a closing date in the contract and one of the conditions in the contract is that "time is of the essence" then, when the closing date comes about and you are in a position to close the sale then you can a) issue a completion notice in which you give the purchasers 28 days to complete failing which they forfeit their deposit and b) look to recover interest on the balance of the purchase monies until they close.

Of course the purchasers will probably be advised not to sign it!

 

[mf1]

"To address the uncertainty of this position can we put a timeline/deadline on the contract after which the 10% deposit is forfeited and our house goes back on the market. Obviously we would generously negotiate the timeline (9/10 months)."

You could try but they should not sign a Contract with that clause. They may be willing but their solicitor will point out their difficulties.

You are facing what is the harsh reality of the market at present. I have several cases just like yours at the moment. My clients are convinced that their houses will sell and have all seen their "dream" homes that they would like to buy. But they need to sell to fund the purchase. They have put their own on the market and several weeks down the line are beginning to realise that there is a good chance that their own houses will not sell. At all. Which means, obviously, they cannot buy.

The problem is that the market has changed so fundamentally that people have to be terribly careful about committing themselves to anything. Up to 18 months ago there was great confidence but not anymore. My clients would happily sign anything - primarily because they refuse to think through the consequences. My job ( solicitor) is to advise them of the possible consequences.

mf

 

[Paulone]

Is it not the case that the potential buyer to whom you wish to sell will simply pay a refundable booking deposit to your estate agent - amounting to say, €5k - which signals their serious interest but which is paid back in the event that they don't go through with it?

I was sale agreed through my EA to someone who was dependent on selling their own house before they could proceed. The EA recommended putting my place went back on the market after a month and a half because there was no immediate prospect of their sale. They were repaid their booking deposit and I was back on the open market again.

The reasoning was that there was no telling when the prospective purchaser could make their own sale, so I was missing out on potential new interest, sitting at the end of what could have been a very long chain - possibly to no good end.

I would not entertain signing any contract which was subject to their sale unless they were sale agreed themselves or had the ability to complete without the need to sell their own house.

It's bad enough that a sale-agreed falls through but very not good when you have contracts drawn up and these collapse.

 

[AppleSun]

i suspect your solicitor will not allow you insert such a clause.

i tried to get that added to mine and i was told 'NO' in no uncertain term.

do not except an offer from someone who has not sold their house yet. in the current market you could be waiting up to a year for them to sell...